Our October cover story: How low-car apartments returned to Portland

Our October cover story: Division Street

Editor’s note: Though most issues of our 10-minute newsmagazine are too graphic-heavy to work well on the Web, we occasionally run more traditional text stories. In this cover story of our current magazine, The Rent Issue, we explore Portland’s chronic shortage of rental housing and the untold story of why that’s finally about to change.

Keala WilliamsIt’s 12 minutes to the next Green Line, and Kaela Williams is halfway through the three-transfer haul to the apartment she shares with her sister and four children for $650 a month.

“I don’t like having no car,” says Williams, 35, who lives at SE 190th and Stark. “But when I have a car, I don’t really care for that either, because of gas.”

Williams, a longtime Portlander, has bounced from northeast Portland to Vancouver to Gresham, chasing apartments as close to work and transit as a hair stylist’s wages can afford.

“Every place that I’ve looked for has to be on the bus line,” she said. “The further you go south, it makes it difficult, so I’ve tried to stay more towards the Northeast.”

Housing conditions at SE Division and 170th.It’s the paradox of 21st century urbanism: Just as more and more people choose low-car lives – households that have more adults than cars accounted for 71% of Portland’s population growth in 2011, the Census reported last month – the families who use low-car transportation most have been priced out of the neighborhoods where it actually works well.

Last month Ed Bryant, who lives on SE 162nd and rides the 4 to his downtown job as a janitor, thought he’d finally scored a place to move in with his fiancé: $1,200 for a 3-bedroom in Moreland, “only about 5 blocks off the bus line,” he said approvingly. Then the landlord asked why he’d arrived on foot, and the interview seemed to end.

“They expect you to roll up in a car,” said Bryant, 56, who owns a car but rarely drives it.

This is what a “massive shortage” of rental housing looks like, said Lisa Bates, a PSU professor of housing policy. Portland’s vacancy rate of 3.6%, second only to New York, lets landlords in high-demand areas rapidly raise rents – up 6% this year – and reject tenants for the slightest of reasons.

“You show up to an open house and there are 40 other people there and they’re ready to outbid you,” said Justin Buri of the Community Alliance of Tenants. “You basically have to be ready with your checkbook.”

“You have to have like two, three times the rent,” said Williams. “If you don’t make that, you can’t move in.”

Though she wishes she could live closer in, Williams hasn’t even bothered looking for a home east of 82nd Avenue. If living on the urban edge is what it takes to keep her family under a roof, she said, she can tolerate it.

“You can’t complain,” Williams said. “Cause it’s a place.”

•••

housing conditions at SE 38th and DivisionJulie Handsaker stood up from her seat in the Multnomah County hearing room, long gray-blond hair around her shoulders.

Southeast Portland, she said, “is getting a Toronto, Vancouver, almost” – her voice began to shake –  “Capitol-Hill-like environment,” she said. “That, to me, is like a rape.”

She was talking about a 4-story apartment building proposed a block from her home.

•••

Forty years after activists blocked the proposed Mount Hood Freeway and redirected the money to build the first MAX line, the bulldozers have returned to southeast Portland. But this time, the battle is different.

Instead of a highway to serve the suburbs, the big rigs now tearing up Division Street are building a thick hedge of apartments that will, for the first time in years, expand the supply of rental housing on Portland’s inner eastside.

It’s not just density, though, that has people like Handsaker vowing to pack a Nov. 13 city meeting. It’s that 22 new eastside buildings will have something very unusual in common: Unlike almost every new development in the city for 50 years, they won’t have on-site auto parking.

This means different things to different people.

To some neighbors accustomed to free street parking – many homes lack driveways, because the area was built for streetcar commuters in the 1910s and 20s – it’s a blight.

parking space costTo developers, it’s a gift. Each parking space would have added $20,000 or more to a building’s cost. If substantial parking were required, some of the projects wouldn’t be financially viable.

To anti-sprawl warriors, it’s a dream come true. “We are underbuilt in this kind of housing,” said Jason Miner, executive director of 1000 Friends of Oregon. “We’ve built a great urban center where people actually want to live. … It’s what we’ve been looking for.”

And to everyone involved, it’s something of a puzzle: Why are banks, after decades of refusing to finance small buildings for low-car renters, finally approving such projects?

But as Eric Cress could tell you, here’s what this remarkable trend isn’t: a coincidence.

•••

cress-planterCress was 34 when he moved to Portland to retire.

It wasn’t quite that simple. Cress’s business partner Steven Pontes, a Portlander since the 1990s, “was always talking about how great Portland is,” Cress recalled. And by 2006, Cress’s Oakland-based real estate development company was smelling a bubble. So they decided to, temporarily, cash out.

“We had more time on our hands,” Cress said. “So we said, ‘We’re coming up!’”

The housing market peaked that year. Cress’s little firm, Urban Development Partners, found itself flush with cash – and buying land.

•••

The drunk driver whose van, early on the first day of 2009, splintered through the front porch of the house at 38th and Division didn’t know the crash would ignite a revolution in low-car housing. If any other landlord had owned the place, it might not have.

But the quarter-acre lot on two major bus lines, one block north of Clinton Street’s iconic bikeway, belonged to UDP.

It was the month U.S. job losses would hit a 60-year high. “Not an easy time to get a project underwritten,” Cress said.

UDP had been watching the numbers. Portland’s rental market, Cress was certain, was about to boom. But there was only one way to make the math work on the east side’s first new apartment building in years: it couldn’t include auto parking.

That was how Cress and his key ally, a young local Wells Fargo vice president named Bryce Payne, decided it was time to explain Portland to a banker. Payne flew the bank’s underwriter up from San Francisco and, Cress said, drove him to the base of the Hawthorne Bridge.

“Look at this,” Payne said.

It was rush hour. The bikes streamed past.

And that, Cress said, was that. Wells Fargo approved the 26-unit project, which rented out rapidly. Tested, the market exploded. Copycat proposals began to pile in.

For good or bad, low-car apartments were coming back to central Portland.

Should Portland require auto parking at every new home? Weigh in by Nov. 13, and also feel free to share your thoughts below or in an email to me. We’ll publish a second blog post full of many perspectives on this issue.

Cress photo by Michael Schoenholtz; Williams photo by Michael Andersen. Data courtesy Census Bureau, Brookings Institution, The Oregonian, Urban Development Partners.

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